The event brought out a huge showing of the city's power players, including sports legends (Magic Johnson, Jim Brown, Rosie Greer), business leaders (Eli Broad via video), Mayors past and present (Villaraigosa, Hahn via video), labor (Maria Elena Durazo) and of course representatives from AEG and Farmers Insurance. The talking points for the event were clearly job creation and 100% private investment, with Leiweke giving his guarantee that the project would not cost tax payers a dime (though some already dispute this claim). The Times explains:
A proposed NFL stadium in downtown Los Angeles would be called Farmers Field under a 30-year naming-rights deal between developer AEG and Farmers Insurance Exchange....a person familiar with the negotiations tells The Associated Press that AEG would get $700 million over 30 years if the firm builds its planned stadium and lures an NFL team to the country's second-largest market.
The person, who spoke on condition of anonymity because they were not authorized to speak publicly about the contract, says AEG would get $1 billion if it places two NFL teams in the stadium.
Though AEG will build the stadium, Leiweke is asking the city of Los Angeles to float $350 million in bonds to cover the cost of tearing down and rebuilding the Convention Center's West Hall and parking, and pay off the remaining debt on the hall. The stadium would be built in its place, and the convention center relocated.
Leiweke said new revenue the city would get from the site, mostly from ticket taxes, would be enough to pay off the bonds, and AEG would cover any shortfalls.
Councilwoman Hahn called for an Independent Financial Analyst to oversee the project and ensure no taxpayer money gets used.The event let out onto an astroturf mini-"Farmers Field" complete with cheerleaders, mimosas, a hot air balloon, and the Farmers Insurance airship flying overhead. Despite having the feel of a groundbreaking ceremony, the announcement today is a preliminary step in a process that has not received any official governmental approval, and is still entirely contingent upon finding a team to play in Los Angeles. The LA Times writes:
Announcing a naming-rights deal for a stadium that has not been built, on a site that has not been approved, for a team that has not been acquired is unheard of. No money will change hands unless each of those wishes becomes fulfilled. But for AEG, making an announcement now provides a concrete benefit -- providing a sense of momentum as the company, owned by billionaire Philip Anschutz, tries to persuade state and city officials to approve other crucial deal points, including a long-term lease agreement on the land for the stadium and expedited review of the environmental impact of building it.
Developer Ed Roski's competing stadium concept in the City Of Industry has already cleared significant regulatory hurdles, having circumvented the state's stringent California Environmental Quality Act with the help of Governor Schwarzenegger and the state legislature. It remains to be seen whether AEG's demand that the Downtown project receive the same "CEQA protections granted to the City of Industry," will be granted.